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Social exclusion, capital accumulation and inequality

Author

Listed:
  • Hazari, Bharat
  • Mohan, Vijay

Abstract

We construct a four-good, four-factor general equilibrium model with trade to show that, under certain conditions, capital accumulation results in: (a) the immiserization of socially excluded groups; (b) an increase in the rate of return on capital; and (c) a decrease in the wage rate of socially excluded groups. Our analysis shows why social exclusion increases inequality.

Suggested Citation

  • Hazari, Bharat & Mohan, Vijay, 2015. "Social exclusion, capital accumulation and inequality," International Review of Economics & Finance, Elsevier, vol. 39(C), pages 371-375.
    • Handle: RePEc:eee:reveco:v:39:y:2015:i:c:p:371-375
    DOI: 10.1016/j.iref.2015.07.004
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    References listed on IDEAS

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    1. Nicholas Kaldor, 1955. "Alternative Theories of Distribution," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 23(2), pages 83-100.
    2. Reza Oladi & Hamid Beladi, 2008. "Non-traded Goods, Technical Progress and Wages," Open Economies Review, Springer, vol. 19(4), pages 507-515, September.
    3. Reza Oladi & John Gilbert & Hamid Beladi, 2011. "Foreign Direct Investment, Non‐Traded Goods And Real Wages," Pacific Economic Review, Wiley Blackwell, vol. 16(1), pages 36-41, February.
    4. Hamid Beladi & Ravi Batra, 2004. "Traded and Nontraded Goods and Real Wages," Review of Development Economics, Wiley Blackwell, vol. 8(1), pages 1-14, February.
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    Cited by:

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    4. Mduduzi Biyase & Carolyn Chisadza, 2023. "Symmetric and asymmetric effects of financial deepening on income inequality in South Africa," Development Southern Africa, Taylor & Francis Journals, vol. 40(5), pages 961-978, September.

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    Keywords

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    JEL classification:

    • D5 - Microeconomics - - General Equilibrium and Disequilibrium
    • F1 - International Economics - - Trade
    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty

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